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stock were allocated to his and his sons’ capital accounts
according to their respective partnership shares. Under the
partnership agreement, each son was entitled to receive
distribution of any part of his capital account with prior
consent of the other partners (i.e., his father and brother), and
was entitled to sell his partnership interest after granting his
father and brother the first option to purchase his interest at
fair market value. Upon dissolution of the partnership, each son
was entitled to receive payment of the balance in his capital
account.
In these circumstances, we conclude and hold that
petitioner’s transfers to the partnership represent indirect
gifts to each of his sons, John and William, of undivided 25-
percent interests in the leased land and in the bank stock.11 In
reaching this conclusion, we have effectively aggregated
petitioner’s two separate, same-day transfers to the partnership
of undivided 50-percent interests in the leased land to reflect
11 We do not suggest, and respondent has not argued, that
such an analysis necessarily entails disregarding the
partnership. Similarly, in Kincaid v. United States, 682 F.2d
1220 (5th Cir. 1982), and in the other cases cited supra treating
gifts to corporations as indirect gifts to the other
shareholders, the courts did not necessarily disregard the donee
corporations. In either case, characterizing the subject gift as
comprising proportional indirect gifts to the other partners or
shareholders, as the case may be, rather than as a single gift to
the entity of which the donor is part owner, reflects the
exigency that the donor cannot make a gift to himself or herself.
See id. at 1224 (“Mrs. Kincaid cannot, of course, make a gift to
herself”).
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